The Islamic State is being funded by black-market oil trading, illegal drugs and internet cafes, a local activist group has claimed.

The group claims that the most important financial resources of ISIS-controlled areas in Syria are secret deals with the Assad regime to sell the government electricity and gas from dams controlled by the militants.

The Islamic State is also imposing strict taxes on its citizens, charging for electricity, phone bills and customs on imported goods, anti-ISIS activist group Raqqa is Being Slaughtered Silently reports.

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Oil, drugs and taxes: A report on how the Islamic State is funded has revealed that the militants have a secret deal to sell electricity to the Syrian government and is growing cannabis which it sells in Turkey

Unlike the core al-Qaeda terrorist network, ISIS gets only a small share of funding from deep-pocket donors and therefore does not depend primarily on moving money across international borders.

Despite several attempts by the coalition forces to cut off funding to the Islamic State militants, the organisation continues to thrive and find independent ways to create capital

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Raqqa is Being Slaughtered Silently(RBSS) is a small activist collective which secretly documents the shocking violence and oppression ISIS has brought to their home city.

In its most recent report on ISIS's funding, RBSS outlines ten ways the militants fund their crusade to create a Muslim caliphate.

The group claims that ISIS and the Syrian government has struck a secret deal which enables the militants to sell electricity and gas to the Assad regime.

Crude ways: The leader of the Islamic State group, Abu Bakr al-Baghdadi, funds his organisation by fining citizens who break sharia law and extracting oil from fields in areas under ISIS control

Terrifying rise: Despite several attempts by the coalition forces to cut off funding to ISIS, the organisation continues to thrive and find independent ways to create capital

Growth of terror: Since its formation as the Islamic State of Iraq and Syria in 2013 - it has conquered regions of Iraq, Syria and recently Libya - while building support among marginalised Muslims in Turkey, Yemen, Saudi Arabia, Egypt's Sinai Province, Afghanistan, Tunisia and Algeria

Fightback: The majority of ISIS' territory lies inside Iraq and Syria but there have been recent reports of defections in Syria, while Iraq plan to retake its second city of Mosul from the Jihadists

The Islamic State controls several important dams as well as a gas field in its occupied areas of Syria.

TEN WAYS THE ISLAMIC STATE IS MAKING MONEY

1. Sales of electricity and gas to the Syrian government through ISIS-controlled dams and gas fields.

Even though the citizens of Raqqa and Islamic State live under strict sharia law, ISIS leaders appear to have no qualms about growing and selling illegal drugs to others, with cannabis being grown on the outskirts of the city to be sold on to Turkey.

The report also reveals details of the of taxes and fines imposed on citizens of Raqqa, ISIS's 'de facto' capital.

This includes flat-rate taxes on electricity, 'hygiene services' and use of the telephone network, paid in cash to ISIS's very own revenue agency, called Al Hisba, as well as customs on imported and exported goods.

Another interesting source of income is Internet cafes, which RBSS calls 'one of the most profitable trades for ISIS'.

The number of internet cafes in Raqqa has increased from 20 to 500 since the Islamic State came to power, according to the group.

As reported by the U.S. Treasury Department last year, ISIS is earning about $1million a day from black market oil and fuel sales by using primitive ways of extracting crude oil from fields in ISIS-controlled areas of Iraq and Syria.

Raqqa is Being Slaughtered Silently also lists fines on breaking sharia law by smoking or being late to prayer, looting and selling historical artefacts and confiscating private land from locals who disagree with the ways of the caliphate and selling it at public auction.